Market Overview

Medtronic Expected To Report Flat Earnings Despite 55% Revenue Growth


Shares of Medtronic PLC (NYSE: MDT) were higher on Monday as the company prepares to announce its Q4 financial results scheduled for Tuesday morning.

According to Estimize, expectations point towards year-over-year earnings, although revenue is projected to come in substantially higher than a year ago.

In the fourth quarter last year, the company reported earnings of $1.12 per share on revenue of $4.566 billion. For the current quarter, revenue is expected to come in north of $7 billion: the company guided revenue of $7.302 billion, the Street models revenue of $7.121 billion, and the crowd, $7.101 billion.

In spite of the marked increase expected on the revenue front, the company guided almost flat year-over-year earnings of $1.11 per share, same as the crowd, while experts are modeling earnings of $1.10 per share.

The second chart illustrates the evolution of sentiment over time. The crowd’s expectations remained essentially flat. However, the Street’s consensus rose substantially over February, before establishing at $1.10.

Medtronic-Covidien’s First Time

In a recent article, analysts at Zacks say that Medtronic is “likely to beat earnings because it has the right combination of two key ingredients.” Namely: an Expected Surprise Prediction of 0.9 percent and a Zacks Rank #3 (Hold). “The combination of Medtronic’s Zacks Rank #3 and +0.90% ESP makes us reasonably confident of a positive earnings beat at the company.”


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